There is no standard attorney malpractice policy definitions wording. But the definitions wording is similar from policy to policy. But minor policy wording differences can be the difference between having coverage or paying for the claim out of your own pocket.
For the firms that contract out or have non-attorney staff working on a contract basis the AIG policy is a good example of a possible issue. The AIG policy’s definition of who is insured adds coverage for a nonlawyer employees:
“You” means the named insured and the persons or entities described below:
b. each nonlawyer employee who was, is, or becomes an employee of the named insured, but only while acting within the scope of employment on behalf of the named insured at the time of such employment.”
The insurer has interpreted this as W2 employee staff for coverage under the policy. If the law firm that has all or part of staff on a contract basis, this could be a problem.
Other malpractice insurance policies may or may not make this coverage distinction.
Read and understand your insurance policy. It is a contract. Asking for a policy copy to read when reporting a claim may make for unwelcome surprises.
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Lee Norcross, MBA, CPCU
Managing Director, CEO
(616) 940-1101 Ext. 7080